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3. The financial statements of Mugs Company appear below: MUGS COMPANY Comparative Balance Sheet Assets Cash Marketable securities. Accounts receivable (net). Inventory. Property, plant and equipment (net) Total assets. Liabilities and stockholders' equity Accounts payable. Short-term notes payable. Bonds payable. Common stock... Retained earnings. Total liabilities and stockholders' equity. Net sales. Cost of goods sold Gross profit Expenses Interest expense Page 8 of 9 C. d. MUGS COMPANY Income Statement For the Year Ended December 31, 2015 FINANCIAL STATEMENT ANALYIS Selling expenses. Administrative expenses Total expenses. Income before income taxes Income tax expense. Net income ManEco-01 2015 P 25,000 20,000 40,000 150,000 170,000 P405,000 P 25,000 40,000 75,000 175,000 90,000 P405,000 P21,000 30,000 20,000 2014 P 40,000 60,000 30,000 170,000 200,000 P500,000 shares. Market value of common stock on December 31, 2015, was P15 per share. Net cash provided by operating activities for 2015 was P65,000. P 30,000 90,000 160,000 145,000 75,000 P500,000 P360,000 184,000 176,000 Additional information: a. Cash dividends of P50,000 were declared and paid in 2015. b. Weighted-average number of shares of common stock outstanding during 2015 was 62,000 71,000 105,000 30,000 P 75,000 Using the financial statements and additional information, compute the following ratios for the Mugs. Company for 2015. Show all computations. 1. Current ratio. 2. Return on common stockholders' equity. 3. Price-earnings ratio.

3. The financial statements of Mugs Company appear below: MUGS COMPANY Comparative Balance Sheet Assets Cash Marketable securities. Accounts receivable (net). Inventory. Property, plant and equipment (net) Total assets. Liabilities and stockholders' equity Accounts payable. Short-term notes payable. Bonds payable. Common stock... Retained earnings. Total liabilities and stockholders' equity. Net sales. Cost of goods sold Gross profit Expenses Interest expense Page 8 of 9 C. d. MUGS COMPANY Income Statement For the Year Ended December 31, 2015 FINANCIAL STATEMENT ANALYIS Selling expenses. Administrative expenses Total expenses. Income before income taxes Income tax expense. Net income ManEco-01 2015 P 25,000 20,000 40,000 150,000 170,000 P405,000 P 25,000 40,000 75,000 175,000 90,000 P405,000 P21,000 30,000 20,000 2014 P 40,000 60,000 30,000 170,000 200,000 P500,000 shares. Market value of common stock on December 31, 2015, was P15 per share. Net cash provided by operating activities for 2015 was P65,000. P 30,000 90,000 160,000 145,000 75,000 P500,000 P360,000 184,000 176,000 Additional information: a. Cash dividends of P50,000 were declared and paid in 2015. b. Weighted-average number of shares of common stock outstanding during 2015 was 62,000 71,000 105,000 30,000 P 75,000 Using the financial statements and additional information, compute the following ratios for the Mugs. Company for 2015. Show all computations. 1. Current ratio. 2. Return on common stockholders' equity. 3. Price-earnings ratio.

Financial And Managerial Accounting
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter14: Financial Statement Analysis
Section: Chapter Questions
Problem 1BE
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3. The financial statements of Mugs Company appear below: MUGS COMPANY Comparative Balance Sheet Assets Cash. Marketable securities Accounts receivable (net) Inventory Property, plant and equipment (net) Total assets. Liabilities and stockholders' equity Accounts payable Short-term notes payable. Bonds payable. Common stock Retained earnings Total liabilities and stockholders' equity. Net sales Cost of goods sold Gross profit Expenses Interest expense Page 8 of 9. MUGS COMPANY Income Statement For the Year Ended December 31, 2015 FINANCIAL STATEMENT ANALYIS Selling expenses Administrative expenses Total expenses Income before income taxes Income tax expense Net income ManEco-01 2015 P 25,000 20,000 40,000 150,000 170,000 P405,000 P 25,000 40,000 75,000 175,000 90,000 P405,000 P21,000 30,000 20,000 2014 P 40,000 60,000 30,000 170,000 200,000 P500,000 shares. C. Market value of common stock on December 31, 2015, was P15 per share.. d. Net cash provided by operating activities for 2015 was P65,000. P 30,000 90,000 160,000 145,000 75,000 P500,000 P360,000 184,000 176,000 71,000 105,000 30,000 P 75,000 Additional information: a. Cash dividends of P50,000 were declared and paid in 2015. b. Weighted-average number of shares of common stock outstanding during 2015 was 62,000 Using the financial statements and additional information, compute the following ratios for the Mugs Company for 2015. Show all computations. 1. Current ratio. 2. Return on common stockholders' equity. 3. Price-earnings ratio. 6. Times interest earned. 7. Profit margin ratio 9. Payout ratio 10. Return on assets 11. Cash debt coverage ratio
Transcribed Image Text:3. The financial statements of Mugs Company appear below: MUGS COMPANY Comparative Balance Sheet Assets Cash. Marketable securities Accounts receivable (net) Inventory Property, plant and equipment (net) Total assets. Liabilities and stockholders' equity Accounts payable Short-term notes payable. Bonds payable. Common stock Retained earnings Total liabilities and stockholders' equity. Net sales Cost of goods sold Gross profit Expenses Interest expense Page 8 of 9. MUGS COMPANY Income Statement For the Year Ended December 31, 2015 FINANCIAL STATEMENT ANALYIS Selling expenses Administrative expenses Total expenses Income before income taxes Income tax expense Net income ManEco-01 2015 P 25,000 20,000 40,000 150,000 170,000 P405,000 P 25,000 40,000 75,000 175,000 90,000 P405,000 P21,000 30,000 20,000 2014 P 40,000 60,000 30,000 170,000 200,000 P500,000 shares. C. Market value of common stock on December 31, 2015, was P15 per share.. d. Net cash provided by operating activities for 2015 was P65,000. P 30,000 90,000 160,000 145,000 75,000 P500,000 P360,000 184,000 176,000 71,000 105,000 30,000 P 75,000 Additional information: a. Cash dividends of P50,000 were declared and paid in 2015. b. Weighted-average number of shares of common stock outstanding during 2015 was 62,000 Using the financial statements and additional information, compute the following ratios for the Mugs Company for 2015. Show all computations. 1. Current ratio. 2. Return on common stockholders' equity. 3. Price-earnings ratio. 6. Times interest earned. 7. Profit margin ratio 9. Payout ratio 10. Return on assets 11. Cash debt coverage ratio
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